This application relates generally to negotiable instruments. More specifically, this application relates to methods and systems for processing official checks, money orders, and other negotiable instruments.
There are numerous applications in which customers wish to purchase negotiable instruments that are backed by guaranteed funds. Such negotiable instruments are much like other negotiable instruments except that their backing is provided by a recognized entity that guarantees the availability of the funds on behalf of the customers. They are, therefore, typically used by consumers as part of relatively large transactions, such as for providing a down payment on the purchase of a house or automobile, but also may be used in other contexts as well. Examples of negotiable instruments whose terms are backed in this way include “certified checks,” which are checks drawn on the customer's account but with those funds earmarked for that particular check by a financial institution; “cashier's checks” and “money orders,” each of which are checks drawn on the financial institution itself, and thereby backed by the financial institution; “teller's checks,” which are checks drawn by the financial institution on another financial institution; and “traveler's checks,” which are a type of instrument drawn on the financial institution, like a cashier's check or money order, but requiring a countersignature by the customer.
The issuance and processing of negotiable instruments by various financial institutions creates a complexity to the system that it is desirable to simplify. This complexity may manifest itself in a variety of different ways, including in procedures that require coordination for clearing and settlement of the instruments when they are negotiated. In addition, some financial institutions, particularly smaller financial institutions, may wish to provide the service of selling negotiable instruments to customers, but do not wish to assume the obligation of providing the backing for those instruments. There are, accordingly, advantages that may result from improved methods and systems for processing negotiable instruments.